The senior leadership of UBS has revived discussions about ways to move the bank out from under Swiss regulators’ heavy hand, including through a combination with a foreign bank, after a setback this week, people familiar with the matter said.
Switzerland’s parliament voted this week to advance a law requiring UBS to raise as much as $20 billion in capital, which bank executives say would gut its ability to lend profitably. “We can live with a black eye, but two black eyes and a broken nose is too much,” CEO Sergio Ermotti said.
UBS has been in a standoff for more than a year with the Swiss government, which is now demanding the bank shore up its foreign subsidiaries with fresh capital. Holding more capital hurts bank profits, and would put UBS at a disadvantage to US banks whose own capital is being freed up by a deregulatory Trump administration.
UBS declined to comment.
